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LETTER TO SHAREHOLDERS

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UOL GROUP LIMITED

(Company Registration No.: 196300438C) (Incorporated in Singapore)

Registered office: 101 Thomson Road #33-00, United Square, Singapore 307591

1 April 2020

To: The shareholders of UOL Group Limited (the “Company”)

Dear Sir/Madam

1. INTRODUCTION

1.1 Summary. We refer to Resolution 11 in the Notice of 57th Annual General Meeting (“AGM”)

of the Company convening the AGM to be held on 23 April 2020. Resolution 11 relates to the

proposed renewal of the Share Buyback Mandate (as defined in paragraph 2.1 below) and

will be tabled for the approval of the shareholders of the Company (“Shareholders”) by way

of an Ordinary Resolution at the AGM.

1.2 This Letter. The purpose of this Letter is to provide Shareholders with information relating to

the above proposal.

1.3 Disclaimer. The Singapore Exchange Securities Trading Limited (“SGX-ST”) takes no

responsibility for the accuracy of any statements or opinions made or reports contained in this

Letter. Shareholders who are in any doubt as to the action they should take, should consult

their stockbrokers or other professional advisers immediately.

2. THE PROPOSED RENEWAL OF THE SHARE BUYBACK MANDATE

2.1 Background. At the 56th Annual General Meeting of the Company held on 25 April 2019

(“2019 AGM”), Shareholders had approved the adoption of a general and unconditional

mandate authorising the directors of the Company (“Directors”) to exercise all powers of the

Company to purchase or otherwise acquire issued ordinary shares of the Company (“Shares”)

on the terms of such mandate (“Share Buyback Mandate”). The authority and limitations of

the Share Buyback Mandate were set out in the Company’s Letter to Shareholders dated

2 April 2019 and the ordinary resolution relating to the Share Buyback Mandate in the notice

of the 2019 AGM, respectively. The authority contained in the Share Buyback Mandate

approved at the 2019 AGM was expressed to continue in force until the next Annual General

Meeting of the Company, and as such, would be expiring on 23 April 2020, being the date of

the forthcoming AGM. It is proposed that such authority be renewed at the AGM.

In this regard, Resolution 11 in relation to the proposed renewal of the Share Buyback

Mandate will be proposed as an Ordinary Resolution for Shareholders’ approval at the AGM.


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It should be noted that any purchase or acquisition by the Company of its Shares (“Share

Buyback”) has to be made in accordance with the Companies Act, Chapter 50 of Singapore

(“Companies Act”), the Listing Manual of the SGX-ST (“Listing Manual”) and such other

laws and regulations as may, for the time being, be applicable.

2.2 Rationale for the Share Buyback Mandate. The rationale for the Company to undertake the

Share Buybacks is as follows:

(a) In managing the business of the Company and its subsidiaries (collectively referred

hereinafter as the “Group”), the Management strives to increase Shareholders’ value

by improving, inter alia, the return on equity of the Company. In addition to growth

and expansion of the business, the return on equity of the Company may also be

enhanced, inter alia, via Share Buybacks. The Share Buyback Mandate will give the

Company the flexibility to undertake Share Buybacks at any time, subject to market

conditions, during the period when the Share Buyback Mandate is in force.

(b) Share Buybacks will allow the Directors to have greater flexibility over, inter alia, the

Company’s share capital structure and its dividend policy, with a view to enhancing

the earnings and/or net asset value per Share.

(c) Shares which are purchased by the Company pursuant to the Share Buyback

Mandate and held by the Company as treasury shares may be utilised for the

purposes of the Company’s share-based incentive scheme(s) to enable the Company

to claim relevant tax deductions under the current taxation regime. The use of

treasury shares in lieu of issuing new Shares would also mitigate the dilution impact

on existing Shareholders.

(d) Share Buybacks provide the Company with a mechanism to facilitate, in an expedient

and cost-efficient manner, the return of surplus cash which is (i) over and above its

ordinary capital requirements, and (ii) in excess of the financial and possible

investment needs of the Group.

Share Buybacks pursuant to the Share Buyback Mandate will be made only as and when the

Directors consider it to be in the best interests of the Company. No Share Buyback will be

made if the Directors believe it will bring about a material adverse effect on the financial

position of the Company or the Group, or result in the Company being delisted from the

SGX-ST.

2.3 Authority and Limits on the Share Buyback Mandate. The authority and limitations of the

Share Buyback Mandate for which renewal is sought are summarised below. In this regard,

the authority and limitations are substantially the same as that of the Share Buyback Mandate

approved previously by Shareholders at the 2019 AGM, save that the definition of “Average

Closing Price” (for determining the maximum purchase price for the purchase or acquisition of

Shares pursuant to the Share Buyback Mandate) has been changed to take into account

amendments to Rule 884(2) of the Listing Manual which took effect on 7 February 2020.

2.3.1 Maximum Number of Shares

The total number of Shares which may be purchased or acquired pursuant to the

Share Buyback Mandate shall not exceed 10% of the total number of Shares


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(excluding any Shares held by the Company as treasury shares and any Shares held

by subsidiaries of the Company in the circumstances referred to in Sections 21(4),

21(4B), 21(6A) and 21(6C) of the Companies Act (“subsidiary holdings”)) as at the

date of the AGM at which the Share Buyback Mandate is approved. Under the

Companies Act and the Listing Manual, treasury shares and subsidiary holdings are

to be disregarded for purposes of computing the 10% limit. As at 3 March 2020 (the

“Latest Practicable Date”), the Company did not have any treasury shares or

subsidiary holdings.

For illustrative purposes only, on the basis of 843,512,232 Shares in issue as at

the Latest Practicable Date and assuming that on or prior to the AGM (a) no further

Shares are issued, (b) no Shares are treasury shares, and (c) no Shares are

subsidiary holdings, not more than 84,351,223 Shares (representing 10% of the total

number of Shares in issue as at that date) may be purchased or acquired by the

Company pursuant to the proposed Share Buyback Mandate.

2.3.2 Duration of Authority

Share Buybacks may be made, at any time and from time to time, on and from the

date of the AGM at which the Share Buyback Mandate is approved, up to the earliest

of:

(a) the date on which the next Annual General Meeting of the Company is held

or required by law to be held;

(b) the date on which the authority conferred by the Share Buyback Mandate is

revoked or varied by Shareholders in a general meeting; and

(c) the date on which the Share Buybacks pursuant to the Share Buyback

Mandate are carried out to the full extent mandated.

2.3.3 Manner of Purchase or Acquisition of Shares

(a) Purchases or acquisitions of Shares may be made by way of:

(i) on-market purchases (“Market Purchases”) transacted on the

SGX-ST through the ready market through 1 or more duly licensed

stock brokers appointed by the Company for that purpose; and/or

(ii) off-market purchases (“Off-Market Purchases”) effected pursuant to

equal access scheme(s) for Share Buybacks from Shareholders.

(b) In an Off-Market Purchase, the Directors may, as they deem fit in the interest

of the Company, impose such terms and conditions in connection with or in

relation to any equal access scheme(s), provided that such terms and

conditions are not inconsistent with the Share Buyback Mandate, the

Companies Act, the Listing Manual, and other applicable laws and

regulations.


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(c) In particular, under the Companies Act, an equal access scheme must satisfy

all the following conditions:

(i) offers for the Share Buybacks shall be made to every person who

holds Shares to purchase or acquire the same percentage of their

Shares;

(ii) all of those persons shall be given a reasonable opportunity to accept

the offers made to them; and

(iii) the terms of all the offers are the same, except that there shall be

disregarded:

(A) differences in consideration attributable to the fact that offers

may relate to Shares with different accrued dividend

entitlements;

(B) differences in the offers introduced solely to ensure that each

person is left with a whole number of Shares; and

(C) (if applicable) differences in consideration attributable to the

fact that the offers relate to Shares with different amounts

remaining unpaid.

(d) Under the Listing Manual, if the Company wishes to make an Off-Market

Purchase pursuant to an equal access scheme, it will be required to issue an

offer document to all Shareholders containing, inter alia, the following

information:

(i) the terms and conditions of the offer;

(ii) the period and procedures for acceptances;

(iii) the reasons for the proposed Share Buybacks;

(iv) the consequences, if any, of the Share Buybacks that will arise under

the Singapore Code on Take-overs and Mergers (“Take-over Code”)

or other applicable take-over rules;

(v) whether the Share Buybacks, if made, would have any effect on the

listing of the Shares on the SGX-ST;

(vi) details of Share Buybacks (if any) made by the Company in the

previous 12 months (whether Market Purchases or Off-Market

Purchases), specifying the total number of Shares purchased, the

purchase price per Share or the highest and lowest prices paid for

the purchases, where relevant, and the total consideration paid for

these Share Buybacks; and


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(vii) whether the Shares purchased by the Company will be cancelled or

kept as treasury shares.

2.3.4 Maximum Purchase Price

The purchase price (excluding brokerage, stamp duties, commission, applicable

goods and services tax and other related expenses) to be paid for the Shares will be

determined by the Directors. However, the purchase price must not exceed:

(a) in the case of a Market Purchase, 105% of the Average Closing Price of the

Shares; and

(b) in the case of an Off-Market Purchase, 120% of the Average Closing Price of

the Shares,

in either case, excluding related expenses of the purchase or acquisition (“Maximum

Price”). For the above purposes:

(A) “Average Closing Price” means the average of the closing market prices of

the Shares over the last 5 market days, on which transactions in the Shares

were recorded, before the date on which the Market Purchase is made or (as

the case may be) the date of the making of the offer pursuant to the

Off-Market Purchase, and deemed to be adjusted for any corporate action

that occurs during the relevant 5 market days and the date on which the

Market Purchase is made or (as the case may be) the date of the making of

the offer pursuant to the Off-Market Purchase;

(B) “date of the making of the offer” means the date on which the Company

makes an offer for the Share Buybacks from Shareholders, stating the

purchase price for each Share and the relevant terms of the equal access

scheme(s) for effecting the Off-Market Purchase; and

(C) “market day” means a day on which the SGX-ST is open for securities

trading.

2.4 Status of Purchased or Acquired Shares. Shares purchased or acquired by the Company

pursuant to the Share Buyback shall be deemed cancelled immediately on purchase or

acquisition, unless such Shares are held by the Company as treasury shares. If they are

cancelled, all rights and privileges attached to such Shares will expire on such cancellation,

and the total number of Shares in issue will be diminished by such number of Shares

cancelled.

2.5 Treasury Shares. Under the Companies Act, Shares purchased or acquired by the Company

may be held or dealt with as treasury shares. Some of the provisions on treasury shares

under the Companies Act are summarised below:

2.5.1 Maximum Holdings

The number of Shares held as treasury shares cannot at any time exceed 10% of the

total number of Shares in issue. For this purpose, any Shares that are held by


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subsidiaries in the circumstances referred to in Sections 21(4B) and 21(6C) of the

Companies Act shall be included in computing the 10% limit.

2.5.2 Voting and Other Rights

The Company cannot exercise any right in respect of treasury shares, including:

(a) the right to attend or vote at meetings; and

(b) the right to receive any dividend and any other distribution (in cash or

otherwise) of the Company’s assets.

Notwithstanding the above, the Company may receive allotments of fully paid bonus

shares in respect of treasury shares, and treasury shares may be sub-divided or

consolidated so long as the total value of the treasury shares after the subdivision or

consolidation is the same as before the subdivision or consolidation.

2.5.3 Disposal and Cancellation

Where Shares are held as treasury shares, the Company may at any time, but

subject always to the Take-over Code, deal with them as follows:

(a) sell the treasury shares for cash;

(b) transfer the treasury shares for the purposes of or pursuant to any share

scheme, whether for employees, directors or other persons;

(c) transfer the treasury shares as consideration for the acquisition of shares in

or assets of another company or assets of a person;

(d) cancel the treasury shares; or

(e) sell, transfer or otherwise use the treasury shares for such other purposes as

may be prescribed by the Minister for Finance.

Under the Listing Manual, an immediate announcement must be made of any sale, transfer,

cancellation and/or use of treasury shares, stating the following:

(A) the date of the sale, transfer, cancellation and/or use;

(B) the purpose of such sale, transfer, cancellation and/or use;

(C) the number of treasury shares sold, transferred, cancelled and/or used;

(D) the number of treasury shares before and after such sale, transfer, cancellation

and/or use;

(E) the percentage of the number of treasury shares against the total number of shares

outstanding before and after such sale, transfer, cancellation and/or use; and


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(F) the value of the treasury shares if they are used for a sale or transfer, or cancelled.

2.6 Listing Rules. Under the Listing Manual, a listed company shall report all purchases or

acquisitions of its shares to the SGX-ST in such prescribed form with such details prescribed

by the SGX-ST in the Listing Manual:

(a) in the case of an on-market purchase, not later than 9.00 a.m. on the market day

following the day on which the market purchase was made; and

(b) in the case of an off-market purchase, not later than 9.00 a.m. on the second market

day after the close of acceptances of the offer.

Rule 884 of the Listing Manual restricts a listed company from purchasing shares by way

of market purchases at a price per share which is more than 5% above the “average closing

price”, being the average of the closing market prices of the shares over the last 5

market days, on which transactions in the shares were recorded, before the day on which the

purchases are made, and deemed to be adjusted for any corporate action that occurs during

the relevant 5-day period and the day on which the purchases are made. The Maximum Price

for a Share in relation to Market Purchases referred to in Paragraph 2.3.4 above complies with

this requirement. Although the Listing Manual does not prescribe a maximum price in

relation to purchases or acquisitions of shares by way of off-market purchases, the

Company has set a cap of 20% above the Average Closing Price of a Share as the Maximum

Price for a Share to be purchased or acquired by way of an Off-Market Purchase.

The Listing Manual does not expressly prohibit any purchase or acquisition of shares by a

listed company during any particular time(s). However, as the Company may be considered

an “insider” in relation to any proposed Share Buyback, the Company will not purchase or

acquire any Shares pursuant to the Share Buyback Mandate as follows:

(a) at any time after any matter or development of a price-sensitive nature has occurred

or has been the subject of a decision of the Board of Directors until the price-sensitive

information has been publicly announced; and

(b) during the period of 2 weeks immediately preceding the announcement of the

Company’s results for each of the first three quarters of its financial year and 1 month

immediately preceding the announcement of the Company’s full-year results (if the

Company announces its quarterly results, whether required by the SGX-ST or

otherwise), or during the period of 1 month immediately preceding the announcement

of the Company’s half-year or full-year results (if the Company does not announce its

quarterly results).

To comply with Rule 723 of the Listing Manual, the Company is required to ensure that at

least 10% of its Shares (excluding treasury shares) are in the hands of the public (i.e. persons

other than the directors, chief executive officer, substantial/controlling shareholders of the

Company and its subsidiaries, and their respective associates). Accordingly, in undertaking

any Share Buybacks, the Directors will use their best efforts to ensure that a sufficient float in

the hands of the public will be maintained so that the Share Buybacks will not adversely affect

the listing status of the Shares on the SGX-ST, cause market illiquidity or adversely affect the

orderly trading of the Shares.


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As at the Latest Practicable Date, approximately 468,883,086 Shares, representing 55.59% of

the Shares (excluding treasury shares) in issue, are in the hands of the public.

Accordingly, the Company is of the view that, as at the Latest Practicable Date, there is a

sufficient number of Shares in issue that is held in the hands of the public, which would permit

the Company to undertake Share Buybacks up to the full 10% limit pursuant to the proposed

Share Buyback Mandate without affecting the listing status of the Shares on the SGX-ST. In

the event that the Company undertakes Share Buybacks, the Company will also consider

investor interests when maintaining a liquid market in the Shares and ensure that there is a

sufficient float for an orderly market.

2.7 Source of Funds. For Share Buybacks pursuant to the Share Buyback Mandate, the

Company may only apply funds legally available for such purchase or acquisition in

accordance with the Company’s Constitution and applicable laws.

The Company intends to use internal sources of funds, external borrowings, or a combination

of both of the aforesaid, to finance the Share Buybacks.

2.8 Financial Effects. It is not possible for the Company to realistically calculate or quantify the

impact of purchases of Shares that may be made pursuant to the Share Buyback Mandate on

the net tangible assets (“NTA”) and earnings per Share (“EPS”) as the resultant effect would

depend on, inter alia, the aggregate number of Shares purchased or acquired, whether the

purchase or acquisition is made out of capital and/or profits, the purchase prices paid for such

Shares, the amount (if any) borrowed by the Company to fund the Share Buybacks and

whether the Shares purchased or acquired are cancelled or held as treasury shares.

The Company’s total number of Shares in issue and total issued share capital will be

diminished by the total number of Shares purchased by the Company and which are

cancelled. The NTA of the Group will also be reduced by the aggregate purchase price paid

by the Company for the Shares.

Under the Companies Act, Share Buybacks may be made out of the Company’s capital

and/or profits so long as the Company is solvent. Where the consideration paid by the

Company for the Share Buybacks is made out of profits, such consideration will

correspondingly reduce the amount available for the distribution of cash dividends by the

Company. Where the consideration paid by the Company for the Share Buybacks is made out

of capital, the amount available for the distribution of cash dividends by the Company will not

be reduced.

The proposed Share Buyback Mandate will be exercised with a view to, inter alia, enhance

the EPS and/or the NTA value per Share of the Group. Accordingly, Share Buybacks will only

be effected by the Company after the Directors have considered relevant factors such as the

working capital requirements, the availability of financial resources and the expansion and

investment plans of the Group, and the prevailing market conditions.

For illustrative purposes only, the financial effects of the Share Buyback Mandate on the

Company and the Group, based on the audited financial statements of the Group and the

Company for the financial year ended 31 December 2019 are set out in Appendix A of this

Letter.


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Shareholders should note that the financial effects set out in Appendix A of this Letter

are purely for illustrative purposes only and they are based on the assumptions set out

thereto. Although the proposed Share Buyback Mandate would authorise the Company

to purchase or acquire up to 10% of the total number of Shares (excluding treasury

shares and subsidiary holdings) in issue as determined in accordance with the

applicable provisions of the Companies Act, the Company may not necessarily

purchase or be able to purchase the entire 10% of the total number of its Shares

(excluding treasury shares and subsidiary holdings) in issue. In addition, the Company

may cancel all or part of the Shares repurchased or hold all or part of the Shares

repurchased in treasury.

2.9 Taxation. Shareholders who are in doubt as to their tax positions or any tax implications in

their respective jurisdictions should consult their own professional advisers.

2.10 Take-over Implications. Appendix 2 of the Take-over Code contains the Share Buy-Back

Guidance Note applicable as at the Latest Practicable Date. The take-over implications

arising from any purchase or acquisition by the Company of its Shares are set out below:

2.10.1 Obligation to make a Take-over Offer

Any resultant increase in the percentage of voting rights held by a Shareholder and

persons acting in concert with him, following any Share Buybacks, will be treated as

an acquisition for the purposes of Rule 14 of the Take-over Code (“Rule 14”).

Consequently, depending on the number of Shares purchased or acquired by the

Company and the number of Shares (excluding treasury shares) in issue at that time,

a Shareholder or group of Shareholders acting in concert with a Director could obtain

or consolidate effective control of the Company and become obliged to make a

take-over offer under Rule 14.

2.10.2 Persons Acting in Concert

Under the Take-over Code, persons acting in concert (“concert parties”) comprise

individuals or companies who, pursuant to an agreement or understanding (whether

formal or informal), co-operate, through the acquisition by any of them of shares in a

company to obtain or consolidate effective control of the company.

Unless the contrary is established, the Take-over Code presumes, inter alia, the

following individuals and companies to be persons acting in concert with each other:

(a) the following companies:

(i) a company;

(ii) the parent company of (i);

(iii) the subsidiaries of (i);

(iv) the fellow subsidiaries of (i);

(v) the associated companies of any of (i), (ii), (iii) or (iv);


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(vi) companies whose associated companies include any of (i), (ii), (iii),

(iv) or (v); and

(vii) any person who has provided financial assistance (other than a bank

in the ordinary course of business) to any of the foregoing companies

for the purchase of voting rights; and

(b) a company with any of its directors (together with their close relatives, related

trusts as well as companies controlled by any of the directors, their close

relatives and related trusts). Close relatives include immediate family

(i.e. parents, siblings, spouse and children), siblings of parents (i.e. uncles

and aunts) as well as their children (i.e. cousins) and children of siblings

(i.e. nephews and nieces).

The circumstances under which Shareholders, including Directors and persons acting

in concert with them respectively, will incur an obligation to make a take-over offer

under Rule 14 as a result of Share Buybacks are set out in full in Appendix 2 of the

Take-over Code.

2.10.3 Effect of Rule 14 and Appendix 2 of the Take-over Code

The effect of Rule 14 when read with Appendix 2 of the Take-over Code is that unless

exempted, Directors and persons acting in concert with them will incur an obligation

to make a take-over offer under Rule 14 if as a result of the Share Buybacks:

(a) the voting rights of such Directors and their concert parties increase to 30%

or more; or

(b) in the event that such Directors and their concert parties hold between 30%

and 50% of the Company’s voting rights, the voting rights of such Directors

and their concert parties increase by more than 1% in any period of 6 months.

In calculating the percentage of voting rights of such Directors and their concert

parties, treasury shares shall be excluded.

However, under Appendix 2 of the Take-over Code, a Shareholder will not be

required to make a take-over offer under Rule 14 if:

(a) he is not acting in concert with the Directors; and

(b) as a result of Share Buybacks by the Company:

(i) the voting rights of such Shareholder increases to 30% or more; or

(ii) if such Shareholder holds between 30% and 50% of the Company’s

voting rights, the voting rights of such Shareholder increases by more

than 1% in any period of 6 months.

Accordingly, such Shareholder need not abstain from voting in respect of the

resolution authorising the Share Buyback Mandate.


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Notwithstanding the above, Shareholders are reminded that those who are in

doubt as to their obligations, if any, to make a mandatory offer under the

Take-over Code as a result of any Share Buybacks should consult the

Securities Industry Council (“SIC”) and/or their professional advisers at the

earliest opportunity.

2.10.4 The Relevant Directors and Concert Parties

(a) As at the Latest Practicable Date, in respect of the following Directors:

(i) Dr Wee Cho Yaw (Chairman, Non-executive and Non-independent

Director of the Company);

(ii) Mr Wee Ee Lim (Deputy Chairman, Non-executive and

Non-independent Director of the Company); and

(iii) Mr Wee Ee-chao (Non-executive and Non-independent Director of

the Company),

(collectively referred hereinafter as the “Relevant Directors”), the following

persons are presumed to be acting in concert with the Relevant Directors

under the Take-over Code:

(A) Chuang Yong Eng, Sofina Whang Sze-Fang and Lim Soon Chie, the

respective spouses of each of the Relevant Directors;

(B) Dr Wee Cho Yaw’s other children, namely Wee Ee Cheong, Wee

Wei Ling and Wee Wei Chi, as well as their respective spouses

Chang Rosana Kung-Ling, Tan Deng Lang and David Eu Yee Tat;

(C) Wee Investments (Pte) Limited and Kheng Leong Company (Private)

Limited;

(D) C.Y. Wee & Company Private Limited;

(E) Haw Par Corporation Limited;

(F) E.C. Wee Pte Ltd;

(G) Protheus Investment Holdings Pte Ltd; and

(H) United Overseas Bank Limited (“UOB”), and its subsidiaries and

associated companies (“UOB Affiliates”),

(who collectively with the Relevant Directors shall be referred hereinafter as

the “Relevant Parties”).

(b) As at the Latest Practicable Date, the Relevant Parties have an aggregate

interest (both deemed and direct) in 373,151,325 Shares representing

approximately 44.24% in the total voting rights of the Company.


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Further details of the Relevant Parties’ direct and deemed interests in the

shareholding of the Company and their voting rights as at the Latest

Practicable Date are set out in Appendix B of this Letter.

(c) As set out in Appendix B of this Letter, the aggregate total interest of the

Relevant Parties may increase by more than 1% in any 6-month period as a

result of the Share Buybacks, assuming that:

(i) the Company purchases the maximum amount of 10% of the total

number of Shares (excluding treasury shares and subsidiary holdings)

in issue pursuant to the Share Buyback Mandate;

(ii) there is no change in the number of Shares held by the Relevant

Parties or which they are deemed interested in as at the Latest

Practicable Date and as at the date of the AGM; and

(iii) there is no change in the number of Shares held by the Relevant

Parties or which they are deemed interested in as at the date of the

AGM and the date of the full exercise of the Share Buyback Mandate.

As a consequence, the Relevant Directors and other members of the

Relevant Parties may be required to make a general offer to the other

Shareholders under Rule 14.

Conditions for Exemption from having to make a Take-over Offer

The Relevant Directors and persons acting in concert with them will be exempted

from the requirement to make a general offer for the Company under Rule 14, when

read with Appendix 2 of the Take-over Code, following an increase in the aggregate

percentage of total voting rights in the Company held by the Relevant Directors and

persons acting in concert with them by more than 1% in any 6-month period as a

result of Share Buybacks, subject to the following conditions:

(i) the Letter to Shareholders on the resolution to approve the renewal of the

Share Buyback Mandate contains advice to the effect that by voting for the

resolution to approve the renewal of the Share Buyback Mandate (the

“Buyback Resolution”), Shareholders are waiving their right to a general

offer at the required price from any of the members of the Relevant Directors

and persons acting in concert with them, who as a result of the Share

Buybacks would increase their voting rights by more than 1% in any period of

6 months; and the names of each of the members of the Relevant Directors

and persons acting in concert with them and their voting rights at the time of

the resolution and after the Share Buybacks to be disclosed in the same

Letter;

(ii) the Buyback Resolution is approved by a majority of those Shareholders

present and voting at the meeting on a poll who could not become obliged to

make an offer for the Company as a result of the Share Buybacks;


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(iii) the Relevant Directors and persons acting in concert with them abstain from

voting for and/or recommending Shareholders to vote in favour of the

Buyback Resolution;

(iv) within 7 days after passing of the Buyback Resolution, each of the Relevant

Directors is to submit to the SIC a duly signed form as prescribed by the SIC;

and

(v) the Relevant Directors and persons acting in concert with them have not

acquired and will not acquire any Shares between the date on which they

know that the announcement of the renewal of the Share Buyback Mandate

is imminent and the earlier of:

(1) the date on which the authority of the Share Buyback Mandate

expires; and

(2) the date on which the Company announces that it has bought back

such number of Shares as authorised by the Share Buyback

Mandate or it has decided to cease buying back its Shares, as the

case may be,

if such acquisitions, taken together with those Shares purchased by the

Company under the Share Buyback Mandate, would cause the aggregate

voting rights in the Company of the Relevant Directors and persons acting in

concert with them to increase by more than 1% in the preceding 6 months.

It follows that where the aggregate voting rights held by the Relevant Directors and

persons acting in concert with them increase by more than 1% solely as a result of

the Share Buybacks and none of them has acquired any Shares during the relevant

period defined above, then the Relevant Directors and/or persons acting in concert

with them would be eligible for the SIC’s exemption from the requirement to make a

general offer under Rule 14, or where such exemption has been granted, would

continue to enjoy the exemption.

If the Company ceases to buy back its Shares pursuant to the Share Buyback

Mandate and the increase in the aggregate voting rights held by the Relevant

Directors and the persons acting in concert with them as a result of the Company

buying back its Shares at the time of such cessation is less than 1%, the Relevant

Directors and their concert parties may acquire further voting rights in the Company.

However, any increase in the percentage of voting rights of the Relevant Directors

and their concert parties as a result of the Share Buybacks will be taken into account

together with any voting rights acquired by the Relevant Directors and their concert

parties (by whatever means) in determining whether the Relevant Directors and their

concert parties have increased their aggregate voting rights in the Company by more

than 1% in any period of 6 months.


14

Shareholders are advised that by voting in favour of the Share Buyback

Mandate, they are waiving their rights to a take-over offer by the Relevant

Directors and persons acting in concert with them in the circumstances set out

above. Such a take-over offer, if required to be made and had not been

exempted by SIC, would have to be made in cash or be accompanied by a cash

alternative at the higher of (A) the highest price (excluding related expenses)

paid by the Relevant Directors and persons acting in concert with them for any

Share in the preceding 6 months or (B) the highest price paid by the Company

for any Share in the preceding 6 months.

Form 2 submission to the SIC

With regards to Condition (iv) of the “Conditions for Exemption from having to make a

Take-over Offer” above, Form 2 (Submission by directors and their concert parties

pursuant to Appendix 2 of the Take-over Code) is the prescribed form to be submitted

to the SIC by a director and persons acting in concert with him pursuant to the

conditions for exemption from the requirement to make a take-over offer under Rule

14 as a result of the buyback of shares by a listed company under its share purchase

mandate.

As at the Latest Practicable Date, the Relevant Directors have informed the Company

that they will respectively be submitting a Form 2 to the SIC within 7 days after the

passing of Resolution 11 relating to the proposed renewal of the Share Buyback

Mandate at the AGM.

2.11 Previous Share Buybacks. As at the Latest Practicable Date, the Company had not, in the

previous 12 months, undertaken any purchases or acquisitions of Shares pursuant to the

Share Buyback Mandate approved previously by Shareholders.

2.12 Directors’ and Substantial Shareholders’ Interests. Please refer to Appendix B of this

Letter for further details relating to:

(a) the interests and voting rights of the Directors in Shares and outstanding share

options granted pursuant to the Company’s share option scheme for the time being

(“Share Options”); and

(b) the interests and voting rights of the substantial shareholders of the Company

(“Substantial Shareholders”) and the other Relevant Parties in Shares,

before and after the purchase of Shares pursuant to the Share Buyback Mandate, assuming

that:

(A) the Company purchases the maximum amount of 10% of the total number of Shares

(excluding treasury shares and subsidiary holdings) in issue pursuant to the Share

Buyback Mandate;

(B) there is no change in the number of Shares and Share Options (where applicable)

held by the Directors, Substantial Shareholders and/or other Relevant Parties or

which they are deemed interested in as at the Latest Practicable Date and as at the

date of the AGM; and


15

(C) there is no change in the number of Shares and Share Options (where applicable)

held by the Directors, Substantial Shareholders and/or other Relevant Parties or

which they are deemed interested in as at the date of the AGM and the date of the full

exercise of the Share Buyback Mandate.

3. DIRECTORS’ RECOMMENDATION

The Directors (other than the Relevant Directors, namely Dr Wee Cho Yaw, Mr Wee Ee Lim

and Mr Wee Ee-chao, who are required to abstain from making any recommendation to

Shareholders to vote in favour of Resolution 11 being the Ordinary Resolution relating to the

proposed renewal of the Share Buyback Mandate) are of the opinion that the proposed

renewal of the Share Buyback Mandate is in the best interests of the Company. Accordingly,

the Directors (other than the Relevant Directors) recommend that Shareholders vote in favour

of Resolution 11 relating to the proposed renewal of the Share Buyback Mandate to be

proposed at the AGM.

4. ABSTENTION FROM VOTING

The Relevant Parties will abstain from voting on Resolution 11, being the Ordinary

Resolution relating to the proposed renewal of the Share Buyback Mandate, at the AGM.

Dr Wee Cho Yaw, Mr Wee Ee Lim and Mr Wee Ee-chao will also not accept nominations to

act as proxy, corporate representative or attorney to vote in respect of the said resolution. The

renewal of the Share Buyback Mandate must be approved by a majority of those

Shareholders present and voting at the AGM on a poll, who could not become obliged to

make a take-over offer as a result of the Share Buybacks.

5. DIRECTORS’ RESPONSIBILITY STATEMENT

The Directors collectively and individually accept full responsibility for the accuracy of the

information given in this Letter and confirm after making all reasonable enquiries that, to the

best of their knowledge and belief, this Letter constitutes full and true disclosure of all material

facts about the proposed renewal of the Share Buyback Mandate, and the Company and its

subsidiaries which are relevant to the proposed renewal of the Share Buyback Mandate, and

the Directors are not aware of any facts the omission of which would make any statement in

this Letter misleading. Where information in this Letter has been extracted from published or

otherwise publicly available sources or obtained from a named source, the sole responsibility

of the Directors has been to ensure that such information has been accurately and correctly

extracted from those sources and/or reproduced in this Letter in its proper form and context.

Yours faithfully

For and on behalf of

the Board of Directors of

UOL Group Limited

Foo Thiam Fong Wellington

Yeong Sien Seu

Secretaries

APPENDIX A

A - 1

Financial Effects of the Share Buyback Mandate

(For illustrative purposes only)

1. For illustrative purposes only, the financial effects of the Share Buyback Mandate on the

Company and the Group, based on the audited financial statements of the Group and the

Company for the financial year ended 31 December 2019 are based on the assumptions set

out below:

(a) based on 843,512,232 Shares as at the Latest Practicable Date and assuming that

on or prior to the AGM (i) no further Shares are issued, (ii) no Shares are treasury

shares, and (iii) no Shares are subsidiary holdings, not more than 84,351,223 Shares

(representing 10% of the total number of Shares (excluding treasury shares and

subsidiary holdings) in issue as at the date of the AGM) may be purchased by the

Company pursuant to the proposed Share Buyback Mandate;

(b) in the case of Market Purchases by the Company and assuming that the Company

purchases the 84,351,223 Shares at the Maximum Price of S$8.05 for 1 Share (being

the price equivalent to 5% above the Average Closing Price of the Shares for

5 consecutive market days on which the Shares were traded on the SGX-ST

immediately preceding the Latest Practicable Date), the amount of funds required for

the purchase of the 84,351,223 Shares (excluding related expenses) is approximately

S$679,027,345; and

(c) in the case of Off-Market Purchases by the Company and assuming that the

Company purchases the 84,351,223 Shares at the Maximum Price of S$9.20 for

1 Share (being the price equivalent to 20% above the Average Closing Price of the

Shares as recorded on the market day on which there were trades in the Shares

immediately preceding the Latest Practicable Date), the amount of funds required for

the purchase of the 84,351,223 Shares (excluding related expenses) is approximately

S$776,031,252.

2. For illustrative purposes only, and based on the assumptions set out in paragraph 1 above

and assuming that:

(a) such purchase or acquisition of Shares is financed by internal sources of funds and/or

external borrowings;

(b) the Share Buyback Mandate had been effective on 1 January 2019; and

(c) the Company had purchased or acquired 84,351,223 Shares (representing 10% of

the total number of its Shares (excluding treasury shares and subsidiary holdings) in

issue at the Latest Practicable Date),

the financial effects of the purchase or acquisition of the 84,351,223 Shares by the Company

pursuant to the Share Buyback Mandate on the audited financial statements of the Group and

the Company for the financial year ended 31 December 2019 for the following scenarios are

set out below in this Appendix A:

APPENDIX A

A - 2

(A) by way of purchases made entirely out of profits and held as treasury shares;

(B) by way of purchases made entirely out of capital and held as treasury shares;

(C) by way of purchases made entirely out of profits and cancelled; and

(D) by way of purchases made entirely out of capital and cancelled.

For ease of reference:

Scenario

Purchased

out of

Type of

purchase

Held as treasury

shares or

cancelled

Maximum

Price per

Share (S$)

1(A) Profits Market

Purchase

Held as treasury

shares

8.05

1(B) Profits Off-Market

Purchase

Held as treasury

shares

9.20

2(A) Capital Market

Purchase

Held as treasury

shares

8.05

2(B) Capital Off-Market

Purchase

Held as treasury

shares

9.20

3(A) Profits Market

Purchase

Cancelled 8.05

3(B) Profits Off-Market

Purchase

Cancelled 9.20

4(A) Capital Market

Purchase

Cancelled 8.05

4(B) Capital Off-Market

Purchase

Cancelled 9.20

APPENDIX A

A - 3

3. Scenario 1(A) – Market Purchases made entirely out of profits and held as treasury

shares

Group Group Company Company

Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000

As at 31 December 2019

Share capital 1,560,918 1,560,918 1,560,918 1,560,918

Capital and other reserves 893,862 893,862 707,088 707,088

Retained earnings 7,592,700 7,592,700 1,477,141 1,477,141

10,047,480 10,047,480 3,745,147 3,745,147

Treasury shares - (679,027) - (679,027)

Shareholders’ funds 10,047,480 9,368,453 3,745,147 3,066,120 Net tangible assets 10,003,511 9,324,484 3,744,563 3,065,536

Non-controlling interests 4,286,809 4,286,809 - -

Current assets 4,481,477 4,267,346 46,160 (167,971)

Current liabilities 2,510,964 2,975,861 542,971 1,007,868

Working capital 1,970,513 1,291,485 (496,811) (1,175,839)

Number of issued Shares 843,512,232 759,161,009 843,512,232 759,161,009

Weighted average number of

Shares 843,149,892 758,798,669 843,149,892 758,798,669

Financial ratios Net tangible assets/Share (S$) 11.86 12.28 4.44 4.04

Current ratio (times) 1.78 1.43 0.09 (0.17)

Earnings per Share (cents) 56.79 63.10 88.40 98.23

APPENDIX A

A - 4

4. Scenario 1(B) – Off-Market Purchases made entirely out of profits and held as treasury

shares


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 1,560,918 1,560,918 1,560,918



10,047,480 10,047,480 3,745,147 3,745,147

Treasury shares - (776,031) - (776,031)

Shareholders’ funds 10,047,480 9,271,449 3,745,147 2,969,116

Net tangible assets 10,003,511 9,227,480 3,744,563 2,968,532


Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,194,481 (496,811) (1,272,843)



Shares 843,149,892 758,798,669 843,149,892 758,798,669

Financial ratios

Net tangible assets/Share (S$) 11.86 12.15 4.44 3.91



APPENDIX A

A - 5

5. Scenario 2(A) – Market Purchases made entirely out of capital and held as treasury

shares


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 1,560,918 1,560,918 1,560,918



10,047,480 10,047,480 3,745,147 3,745,147

Treasury shares - (679,027) - (679,027)




Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,291,485 (496,811) (1,175,839)



Shares 843,149,892 758,798,669 843,149,892 758,798,669

Financial ratios




APPENDIX A

A - 6

6. Scenario 2(B) – Off-Market Purchases made entirely out of capital and held as treasury

shares


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 1,560,918 1,560,918 1,560,918



10,047,480 10,047,480 3,745,147 3,745,147

Treasury shares - (776,031) - (776,031)




Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,194,481 (496,811) (1,272,843)



Shares 843,149,892 758,798,669 843,149,892 758,798,669

Financial ratios




APPENDIX A

A - 7

7. Scenario 3(A) – Market Purchases made entirely out of profits and cancelled


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 1,404,826 1,560,918 1,404,826


Retained earnings 7,592,700 7,069,765 1,477,141 954,206




Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,291,485 (496,811) (1,175,839)



Shares 843,149,892 758,798,669 843,149,892 758,798,669




APPENDIX A

A - 8

8. Scenario 3(B) – Off-Market Purchases made entirely out of profits and cancelled


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 1,404,826 1,560,918 1,404,826


Retained earnings 7,592,700 6,972,761 1,477,141 857,202




Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,194,481 (496,811) (1,272,843)



Shares 843,149,892 758,798,669 843,149,892 758,798,669




APPENDIX A

A - 9

9. Scenario 4(A) – Market Purchases made entirely out of capital and cancelled


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 881,891 1,560,918 881,891






Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,291,485 (496,811) (1,175,839)



Shares 843,149,892 758,798,669 843,149,892 758,798,669




APPENDIX A

A - 10

10. Scenario 4(B) – Off-Market Purchases made entirely out of capital and cancelled


Before Share

Buyback

S$’000

After Share

Buyback

S$’000

Before Share

Buyback

S$’000

After Share

Buyback

S$’000


Share capital 1,560,918 784,887 1,560,918 784,887






Current assets 4,481,477 4,267,346 46,160 (167,971)


Working capital 1,970,513 1,194,481 (496,811) (1,272,843)



Shares 843,149,892 758,798,669 843,149,892 758,798,669




APPENDIX B

B - 1

The following information is based on the Company’s Register of Directors’ Shareholdings and the

Register of Substantial Shareholders, and information provided to the Company by the Directors,

Substantial Shareholders and/or other Relevant Parties, as at the Latest Practicable Date, and as at

the date of the AGM (on the assumption that their voting rights will not change between the Latest

Practicable Date and the date of the AGM):

Before Share Buyback

(Number of Shares)

Name

Direct

Interest

Deemed

Interest Total Interest

Before

Share

Buyback

%(1)

After

Share

Buyback

%(2)

Outstanding

Share

Options

Directors (other than the Relevant Directors)

Liam Wee Sin 288,777 - 288,777 0.0342 0.0380 440,000

Low Weng Keong 37,694 - 37,694 0.0045 0.0050 -

Tan Tiong Cheng 120,528 - 120,528 0.0143 0.0159 -

Poon Hon Thang Samuel - - - - - -

Sim Hwee Cher - - - - - -

Lee Chin Yong Francis - - - - - -

The Relevant Parties

The Relevant Directors

Wee Cho Yaw 3,661,566 307,235,597(3) 310,897,163 36.8575 40.9527 -

Wee Ee-chao 31,735 120,030,885(4) 120,062,620 14.2337 15.8152 -

Wee Ee Lim 260,975 119,755,315(5) 120,016,290 14.2282 15.8091 -

Other Relevant Parties (who are also Substantial Shareholders)

Wee Ee Cheong 318,417 234,995,947(6) 235,314,364 27.8970 30.9966 -

C. Y. Wee & Company

Private Limited 115,162,017 - 115,162,017 13.6527 15.1696 -

Wee Investments (Pte)

Limited 119,735,836 - 119,735,836 14.1949 15.7721 -

UOB - 59,840,998(7) 59,840,998 7.0943 7.8825 -

Haw Par Corporation

Limited - 72,044,768(8) 72,044,768 8.5410 9.4901

-

Other Relevant Parties (who are not Substantial Shareholders)

Chuang Yong Eng 274,858 - 274,858 0.0326 0.0362 -

Chang Rosana Kung-Ling 3,626 - 3,626 0.0004 0.0005 -

APPENDIX B

B - 2

Lim Soon Chie 2,828 - 2,828 0.0003 0.0004 -

Sofina Whang Sze-Fang 1,361 - 1,361 0.0002 0.0002 -

Wee Wei Ling 1,235,816 - 1,235,816 0.1465 0.1628 -

Wee Wei Chi 172,721 - 172,721 0.0205 0.0228 -

Tan Deng Lang 31,567 - 31,567 0.0037 0.0042 -

David Eu Yee Tat 39 - 39 NM(9) NM(9) -

Kheng Leong Company

(Private) Limited 18,118 - 18,118 0.0021 0.0024

-

E. C. Wee Pte Ltd 79,976 - 79,976 0.0095 0.0105 -

Protheus Investment

Holdings Pte Ltd 274,103 - 274,103 0.0325 0.0361

-

Haw Par Investment

Holdings Private Limited 28,705,436 - 28,705,436 3.4031 3.7812

-

Haw Par Capital Pte Ltd 38,649,505 - 38,649,505 4.5820 5.0911 -

Pickwick Securities

Private Limited 1,888,037 - 1,888,037 0.2238 0.2487

-

Haw Par Equities Pte Ltd 695,598 - 695,598 0.0825 0.0916 -

Straits Maritime Leasing

Private Limited 1,539,974 - 1,539,974 0.1826 0.2029

-

Haw Par Trading Pte Ltd 324,209 - 324,209 0.0384 0.0427 -

M&G Maritime Services

Pte. Ltd. 242,009 - 242,009 0.0287 0.0319

-

Notes:

(1) As a percentage of the total number of issued Shares as at the Latest Practicable Date, comprising 843,512,232

Shares (none of which are treasury shares or subsidiary holdings).

(2) As a percentage of the total number of Shares in issue, comprising 759,161,009 Shares (assuming that the Company

purchases the maximum number of 84,351,223 Shares under the Share Buyback Mandate).

(3) Dr Wee Cho Yaw’s deemed interest in the Shares arises as follows:

(a) 115,162,017 Shares held by C. Y. Wee & Company Private Limited

(b) 119,735,836 Shares held by Wee Investments (Pte) Limited

(c) 72,044,768 Shares which Haw Par Corporation Limited is deemed to be interested in

(d) 18,118 Shares held by Kheng Leong Company (Private) Limited

(e) 274,858 Shares held by his spouse, Mdm Chuang Yong Eng

(4) Mr Wee Ee-chao’s deemed interest in the Shares arises as follows:

(a) 119,735,836 Shares held by Wee Investments (Pte) Limited

(b) 274,103 Shares held by Protheus Investment Holdings Pte Ltd

(c) 18,118 Shares held by Kheng Leong Company (Private) Limited

(d) 2,828 Shares held by his spouse, Ms Lim Soon Chie

(5) Mr Wee Ee Lim’s deemed interest in the Shares arises as follows:

(a) 119,735,836 Shares held by Wee Investments (Pte) Limited

(b) 18,118 Shares held by Kheng Leong Company (Private) Limited

(c) 1,361 Shares held by his spouse, Ms Sofina Whang Sze-Fang

APPENDIX B

B - 3

(6) Mr Wee Ee Cheong’s deemed interest in the Shares arises as follows:

(a) 115,162,017 Shares held by C. Y. Wee & Company Private Limited

(b) 119,735,836 Shares held by Wee Investments (Pte) Limited

(c) 79,976 Shares held by E. C. Wee Pte Ltd

(d) 18,118 Shares held by Kheng Leong Company (Private) Limited

(7) UOB’s deemed interest in the Shares arises as follows:

(a) 59,245,898 Shares held in the name of Tye Hua Nominees (Private) Limited for the benefit of UOB

(b) 595,100 Shares held by UOB Asset Management Ltd (“UOBAM”) as client portfolios managed by UOBAM

(Discretionary)

(8) Haw Par Corporation Limited’s deemed interest in the Shares arises as follows:

(a) 28,705,436 Shares held by Haw Par Investment Holdings Private Limited

(b) 38,649,505 Shares held by Haw Par Capital Pte Ltd

(c) 1,888,037 Shares held by Pickwick Securities Private Limited

(d) 695,598 Shares held by Haw Par Equities Pte Ltd

(e) 1,539,974 Shares held by Straits Maritime Leasing Private Limited

(f) 324,209 Shares held by Haw Par Trading Pte Ltd

(g) 242,009 Shares held by M&G Maritime Services Pte. Ltd.

(9) “NM” denotes not meaningful.

In the event that, after the proposed renewal of the Share Buyback Mandate is approved by

Shareholders at the AGM, the Company undertakes Share Buybacks of up to 10% of the total number

of Shares (excluding treasury shares and subsidiary holdings) in issue, being 84,351,223 Shares as

at the Latest Practicable Date, as permitted by the Share Buyback Mandate, the voting rights and

total interests of the Relevant Parties, assuming that there is no change in the number of Shares held

by the Relevant Parties or which they are deemed interested in, will be increased as follows:

% of shareholding interest

before Share Buyback of up to

10% of the total number of issued

Shares

(excluding treasury shares and

subsidiary holdings)

% of shareholding interest

after Share Buyback of up to

10% of the total number of issued

Shares

(excluding treasury shares and

subsidiary holdings)

The Relevant Parties 44.24 49.15

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